DuPont Decomposition
Why does SARDAEN earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
15.0% = 19.6% × 0.50 × 1.54
Latest: FY2026
Profitability
Net Margin
19.6%
20.7% →19.6%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.50x
0.73x →0.50x
Revenue per ₹ of assets
Leverage
Equity Multiplier
1.54x
1.76x →1.54x
Assets funded by equity vs debt
Trend Analysis
ROE declined by 11.8 pp over 5 years. Driven by net margin declining (20.7% → 19.6%), asset turnover declining (0.73x → 0.50x), leverage falling (1.76x → 1.54x).
Historical Decomposition
Last 5 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2022 | ₹0Cr | ₹0Cr | 20.7% | 0.73 | 1.76 | 26.8% |
| FY2023 | ₹0Cr | ₹0Cr | 14.4% | 0.76 | 1.61 | 17.7% |
| FY2024 | ₹0Cr | ₹0Cr | 13.7% | 0.64 | 1.54 | 13.4% |
| FY2025 | ₹0Cr | ₹0Cr | 15.2% | 0.45 | 1.61 | 11.1% |
| FY2026 | ₹0Cr | ₹0Cr | 19.6% | 0.50 | 1.54 | 15.0% |
How to read DuPont
- • Rising ROE from margin = pricing power, operational improvement (good)
- • Rising ROE from turnover = better asset utilization (good)
- • Rising ROE from leverage = more debt, amplified risk (caution)
- • Falling ROE across all three = structural deterioration (red flag)
DuPont decomposition from audited annual financials. Factual analysis, not investment advice.